In tech, you create something that at least approximates what you aim to build. You then kick the tires and compare your creation to your requirements and see where it falls short. You can then go back and fix your project by redesigning or re-implementing portions of the project that did not meet your satisfaction.
In the early days of Bitcoin, many users were misinformed on the issue of how the cryptocurrency guaranteed anonymity. They confused pseudo-anonymity for full-anonymity until when several Bitcoin tumbling tools were introduced into the crypto space.
To what extent is Bitcoin anonymous?
All Bitcoin transactions are stored in an immutable public ledger. This means that anyone can access, view, and analyze the transactions behind every Bitcoin address. On a different note, a Bitcoin address only remains anonymous when it cannot be directly linked to the user’s identity.
Notably, through rigorous analysis techniques and tools, one can trace transactions associated with a particular Bitcoin address. Consequently, suppose the user behind the scrutinized address engaged in transactions governed by KYC (Know Your Customer) policies. Then his/her real-world identity can be revealed.
As the popularity of Bitcoin grew, users realized that there was little effort required to unveil the real-world identities behind their address. This led to the invention of Bitcoin scramblers. An online tool leveraged for improving cryptocurrency user’s anonymity by disassociating a sender’s and recipient’s addresses.
How does Bitcoin mixing work?
An ideal Bitcoin transaction involves the sender directly sending some amount of Bitcoin to a recipient’s wallet. Therefore, since there is a direct link between the sender’s and recipient’s addresses, their identities can always be revealed under a rigorous analysis of their transactions registered on the blockchain.
When you use a Bitcoin scrambler, your coins are first delivered to the online platform, where they are mixed with coins from other wallets. As a result of the tumbling process, your coins are randomly sent to other people, and you also receive coins from other people.
To further sever the links between different Bitcoin sources, a bitcoin mixer utilizers two independent wallets for sending and receiving of coins from the tumbler. This means that the portfolio you will use to send your original Bitcoins is not the one you will use to receive the mixed Bitcoins from the scrambler.
Factors to consider when choosing a Bitcoin mixer
1. Duration of the mixing process
A tumbler with a longer span for the mixing process exposes your BTC to a larger pool of coins compared to one with a shorter time frame. Notably, the larger the pool your BTC is exposed to the more anonymity you are likely to achieve.
2. Privacy of the mixer’s users
The main reason as to why you are utilizing a mixing platform is to protect your identity. Therefore, always opt for a mixer that embraces a no-log policy to ensure that all your transaction details are never kept on their servers. Additionally, also ensure that your platform of choice has no KYC measures to avoid providing any registration details that might break your identity.
3. The volume of transaction supported and service fees
Whereas some mixers only support a small number of coins, others allow for tumbling of a large volume of BTC in one transaction. The service you choose should, therefore, be reliable enough to support your volume of transactions.
On a different note, before registering for a tumbler’s services, ensure that you are comfortable with their service fees. Overly, most mixing services charge a fee of between 1% to 5% per transaction.
Is mixing Bitcoins legal?
One of the most significant debates surrounding the use of BTC tumblers touches on their legality. Notably, the lawfulness of mixing Bitcoins is majorly dependent on one’s geographical location. Nevertheless, so far, there is no country with specific laws banning the use of cryptocurrency mixers.
However, it is essential to take heed of federal money laundering policies that declare unlawful sending or receiving proceeds with the intent of promoting or facilitating criminal activities. Before tumbling BTC in your country, always find out if your country supports the service.
Does Bitcoin mixing work?
In summary, the question of whether BTC tumbling works or not is based on whether the final goal of achieving anonymity is met or not. Consequently, a service that exposes users’ Bitcoins to a large mixing pool, protects user’s privacy in the mixing process, and supports the anticipated volume of transactions at reasonably affordable fees, will definitely meet the ultimate goal of providing users with the anonymity that they need.
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